How does it increase privacy compared to payee generating new address for every payment? If you see that payee reuses the address for your payments, what's cheaper for payee: to start generating new addresses or adopting more complex scheme involved receiving some data from the payer (instead of just observing the blockchain)?
The main advantage is that the payee doesn't have to be active and provide addresses every time someone wants to make a payment. The payer can independently and without any action from the payee create an address and make the payment. As I wrote above, this makes it easier for cases like an open source project development fund, where people can just send payments without talking with the payee first.